If You Generate a Cryptocurrency Through Mining, Do You Actually ‘Own’ It Under Philippine Law?

Cryptocurrency mining has raised a novel legal question in the Philippines: if you mine cryptocurrency, do you actually own it? The law is clear about how people can acquire property, whether by finding it, creating it, buying it, or inheriting it.

But mining, which involves solving complex mathematical puzzles to generate digital coins, does not fit neatly into these traditional categories. This leaves individuals, businesses, and regulators in a gray area with no clear answer.

The Civil Code of the Philippines outlines several ways to acquire ownership, including occupation, intellectual creation, and prescription. However, none of these were written with digital assets in mind. Can mined cryptocurrency be legally recognized under any of these traditional modes of acquiring property? Let's break it down.

What is Cryptocurrency Mining?

Cryptocurrency mining is how certain digital currencies, like Bitcoin, stay secure and up to date. It works like this: every time someone makes a transaction using Bitcoin, that transaction needs to be checked and added to a big public record called the blockchain. That’s where miners come in.

Miners use powerful computers to solve really tough math problems. These problems help confirm that transactions are valid and group them into a “block.” All the miners are racing to solve the problem first, and many also rely on a Crypto investment calculator to estimate whether their mining efforts will deliver profitable returns. 

Whoever solves it before everyone else gets to add the next block to the chain and, as a reward, earns some newly created cryptocurrency, a process that also forms the backbone of solutions like Cryptocurrency MLM Software.

Beyond generating new coins, mining maintains the blockchain’s integrity and security. It ensures that transactions are legitimate and that the network remains resistant to tampering or fraud.

What are the Modes of Acquiring Ownership Under Philippine Law?

Under the Civil Code of the Philippines (Book II), there are clear rules about how someone can legally become the owner of something, whether it’s land, money, or even intangible assets. 

These rules are called modes of acquiring ownership, and they basically explain how ownership is gained, either from scratch (original ownership) or by getting it from someone else (derivative ownership). Let’s walk through the main categories:

1. Original Modes of Ownership

These apply when ownership starts fresh, without being passed down or transferred from a previous owner.

a. Occupation

You become the owner of something simply by taking possession of it, but only if it doesn’t already belong to someone. Examples include picking up abandoned property, catching wild fish or animals (if allowed by law), and finding hidden treasure (with some rules if it’s on someone else’s land)

b. Intellectual Creation

You own what you create with your mind. If you write a book, compose music, or invent something, the law (through the Intellectual Property Code) gives you ownership of that creation.

2. Derivative Modes of Ownership

These happen when ownership is passed to you from someone who already owned the property.

• Law - the law gives you ownership automatically. Examples of this include inheritance, or when the State acquires private property for public use (with payment).

• Donation - Ownership is transferred as a gift.

• Succession - This is when ownership is transferred after someone dies.

• Prescription - If you use or possess something for a long time, you can become its legal owner.

• Tradition - This is ownership by delivery. If someone hands over a property to you with the intent to transfer ownership, you become the owner.

3. Ownership Through Contracts

Contracts are the most common way people gain ownership. If you buy something, you become its owner once the contract is finalized and the item is delivered.

4. Accession

Ownership includes not just the main property, but also the things that come from it or are added to it.

a. Natural Accession

You own the products or income that your property naturally produces, such as:

• Natural Fruits - Crops harvested from your land.

• Industrial Fruits - Items produced in your factory.

• Civil Fruits - Rent earned from leasing your property.

b. Artificial Accession

If someone builds or adds something to your land, and they did it in good faith, you may own the improvement but they might be entitled to compensation. For example, if a builder constructs a house on your lot by mistake, the law (Art. 448) says you either pay for it or let them buy the land.

c. Alluvium and Avulsion

• Alluvium - Soil slowly added by river action belongs to the landowner next to the river (riparian owner).

• Avulsion - If a chunk of land is suddenly moved by water, the original owner keeps the right to reclaim it but must do so within two years.

Does Cryptocurrency Mining Fall Under One of These Modes of Acquiring Ownership?

So, Do You Actually Own Mined Cryptocurrency Under Philippine Law?

At present, there is no specific law in the Philippines that directly addresses how digital assets like cryptocurrency are acquired through mining. The Civil Code—drafted in the mid-20th century—was created in a very different economic and technological era. 

Lawmakers at the time were more concerned with carabaos and rice fields instead of cryptocurrency news and digital currencies. Unsurprisingly, concepts like blockchain protocols and mining incentives might not have been within the contemplation of the drafters of the Code.

Be that as it may, the Civil Code’s recognized modes of acquiring ownership can still serve as useful frameworks for analysis even if they weren’t built for this specific context.

Of all the traditional modes, contract provides the strongest basis for recognizing ownership of mined cryptocurrency. While mining doesn’t involve a bilateral agreement between two people, it still reflects a transactional structure: the miner performs work—contributing computational power—and receives cryptocurrency in return. This mirrors a contract of exchange, despite the absence of a formal agreement.

But who is the “other party” in this contract? The answer might be unconventional: it is the protocol itself. In Bitcoin’s case, the network protocol (originally set by the enigmatic Satoshi Nakamoto) establishes the rules, enforces them, and distributes the rewards. 

By choosing to participate in the network and submitting work under those conditions, a miner arguably enters into an implied contract with the system. The protocol does not have a legal personality but it governs behavior and executes outcomes consistently. In this way, miners are “parties” to a decentralized agreement governed not by signatures, but by code.

So while the Civil Code doesn’t yet account for this kind of digital transaction, it’s possible—and even reasonable—to extrapolate that mining gives rise to ownership through an implied and non-traditional contract. It may not involve two human beings shaking hands, but it fulfills the fundamental legal idea of quid pro quo: you do something, you receive something in return.